Ucal Fuel closes ‘unviable’ plant in Puducherry

‘Products have become obsolete’

January 11, 2022 03:51 am | Updated 03:51 am IST - CHENNAI

Ucal Fuel Systems Ltd. has decided to shut down its Pu ducherry unit from March 12 as it products have become completely outdated and fallen into disuse due to technology transition.

In a regulatory filing, the company said it had decided to stop completely manufacturing activities at its Plant II located at PIPDIC Industrial Estate in Puducherry from March 12.

Restriction on emission norms imposed by the government, technological change, and transition from BS IV to BS VI and to electric vehicles were the reasons attributed by the management for rendering its products completely outdated.

Further, alternative products in the fuel systems and diversification were considered to be far-fetched, besides, it faced intense competition.

“As such, there is no alternative business or business prospects to continue our operations,”it said.

The sales turnover from Plant II had been on the decline since FY19. From ₹140 crore it dropped to ₹23 crore in FY21. For the six months ended September 21, it was only ₹10 crore.

The firm was making two/three fuel management system parts, four-wheeler MPFI parts and four- wheeler carburetors at the plant.

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